IPL – KXIP income: The Indian Premier (IPL) League franchise Kings XI Punjab’s holding entity K.P.H Dreams Cricket Private Limited has reported that their revenues for FY20 has seen a 43% decline due to drop in Central Revenues. But still Burman is pleased with the franchise’s financial performance and declared that ‘finally promoters have recovered their investments’
KXIP co-owner Mohit Burman said that the team owners have finally recovered their investments. “Yes, finally after a decade,” Burman said in response to a question whether the KPH promoters have fully recovered their investments.
Commenting on the FY20 financials, Burman said, “We were pretty much on course and are thankful to our sponsors and other partners who stood by us. The revenue split between the central pool and franchise sponsorship was 80:20.”
According to KPH’s financial details accessed by CARE Ratings, the company’s net profit increased to Rs 60.78 crore from Rs 44.55 crore while profit before interest, lease, depreciation, and tax (PBILDT) almost halved to Rs 84.57 crore from Rs 164.63 crore in FY19.
The franchise has reported that the reason for the drop in operating income was due to a decrease in the IPL Central revenue pool received from the IPL owners BCCI.
- KPH received lower payment from BCCI from Central Pool in FY20.
- As per the contract between BCCI and Star, the board received 25% (Rs 4086.87 crore) of the media rights payment in FY19 and will receive 18.75% (Rs 3065.15 crore) each in the subsequent years. In September 2017.
- In FY19, KPH’s operating income stood at Rs 374.80 crore as the company had booked revenue for three of its fourteen matches played in IPL-12 in FY19 since they were played in the month of March 2019
- The media rights income was also higher since Star paid 25% of its media rights fee in FY19.
- The PBILDT margin declined to 39.37% in FY20 from 43.93% in FY19. However, the PAT margins increased to 28.29% in FY19 from 11.89% in FY19 as no extraordinary expenses were booked by the company in FY20.
In April-2008, KPH had acquired the rights to operate KXIP franchisee and became a member of the IPL against payment of Rs 304 crore for a period of 10 years.The company also owns another franchisee St. Lucia Zouks in the Caribbean Premier League.